BUENOS AIRES, Jan. 13 (UPI) -- Argentina's runaway inflation has caused shortages, mostly induced by profiteering, yet none so unexpected as the current scarcity of banknotes.
The first among the general public to experience the absence of banknotes were customers who went to banks to withdraw cash. Many were turned away, not because they had insufficient credit balances but because the banks serving them had insufficient bills to hand out.
Protests broke out outside bank branches as many people who lined up for collecting cash from their accounts were turned away.
Officials this week reassured the citizens more banknotes were on the way after the government issued an urgent print order for 3 billion pesos -- $750 million -- in 100-peso bills.
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Argentina's banknotes are being printed in Brazil since a new contract went into effect in November. Argentine regulators initially ordered a small quantity but hurriedly revised the order as the problem became apparent.
Central Bank President Mercedes Marco del Pont assured the pubic relief was on way but there was no immediate indication of when the banknotes might become available.
Many regions reported banknote shortages during the Christmas and New Year's holiday periods and cash dispensing machines stood empty of cash in several areas.
In some areas, employees paid salaries and wages in installments to cope with the shortage of bills.
Argentina stumbled into an inflationary muddle last year amid huge cash outlays from the country's commodity export earnings. Inflation is reported to be running at an annual rate of more than 25 percent.
Argentina's troubles contrasted with sharp spikes in the values of Brazilian real and Chilean peso, partly the result of foreign capital infusions, which led to both governments taking emergency measures to keep currency values down and exports attractive.
As Latin America's second-biggest economy, Argentina has enormous appetite for cash in both commercial and consumer sectors but the government has resisted pressures to print banknotes for larger denominations, fearing the move may fuel inflation.
Drought conditions brought on by La Nina weather phenomenon raised prospects of more shortages and hoarding by consumers fearful of the scarcity of essential goods.
Analysts said La Nina posed a major threat to Argentina's economic growth and would likely impact on export revenues from cash crops across the board.
Early estimates said Argentina's economy grew 9 percent last year but final figures won't be available until the spring. Meanwhile, economists expressed concerns La Nina could reverse gains made last year.
